What I most enjoy about my work here at CIS is the opportunity to do to the sort of research I did in the good old days when I was an investigative reporter and had weeks or months to dig into a story.
This week I got two fascinating views of the ongoing debate over guestworkers. One came from the right, via C-Span's website. The other came from the left, via Audible.com.
First I saw C-SPAN's March 31 interview with Rebecca Tallent, one of the authors of the 2006 and 2007 "comprehensive immigration reform" legislation that produced furious debate, but failed to pass. Tallent was then working for Sen. John McCain (R-Ariz.), who struck a deal with Sen. Edward Kennedy (D-Mass.).
Tallent explained why that legislation proposed that 400,000 low-skilled workers be allowed into the country every year. Since they would have two-year visas, the program would provide employers a pool of 800,000 foreign workers.
Tallent, now director of immigration policy at the Bipartisan Policy Center, explained that the number was set at a level that would accommodate all those who were crossing the border illegally and finding jobs in the U.S. economy.
She explained why she thought that was a good thing:
Probably the best thing that we can do for our border security is have a realistic temporary worker program that reflects the number of people that want to come in every year. To shortchange that number is going to cause us to just repeat the same cycle of people trying to find a way to come into the country. … If there are willing workers in sending countries and willing employers here in the United States who are trying to fill jobs that Americans frankly are unlikely to fill many of them, then you're still going to have people coming here and overstaying their visas… and finding a way to get into this country."
Then I heard a dissenting view, written by liberal economist Jared Bernstein in his book Crunch: Why Do I Feel So Squeezed? It is a lively book, a passionate plea on behalf of American workers.
Bernstein saw the guestworker program as a power play by the business class, a disruption of the free market whose ultimate effect would be to shift wealth to the powerful and widen the gap between rich and poor.
Now a senior fellow at the Center on Budget and Policy Priorities, Bernstein questioned the 2007 claim by Commerce Secretary Carlos Gutierrez that guestworkers were necessary to avoid labor shortages.
Consider this when you hear the "labor shortage" complaint. If there's really a shortage, the price of the thing in short supply should rise. In this case, we're talking about the wage of the worker in the shortage occupation. In fact, such wage movements represent an important mechanism in free-market economies like ours. It's called a price signal, and it signals workers in other occupations, ones that might be contracting, to shift over to the ones where they're needed. If you jam this signal by artificially inflating supply, you damage the structure of economic returns in the job market, which leads to greater levels of income inequality.
Now the guestworker proposal is back, in a more modest form after emerging from discussions between labor and capital. We'll see what develops.
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